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Jan 04, 2019

Mr. Cooper (COOP, $12.79) Enters $1 Billion Service Transaction Deal with IBM (IBM, $117.13)

On January 3, Mr. Cooper Group Inc.,  announced the acquisition of certain non-core assets of IBM for $48 billion. Chief of these assets include the purchase of IBM’s Seterus mortgage servicing platform that was primarily designed to help a client manage a portfolio of distressed loans in times of financial crisis, especially during 2008. Mr. Cooper’s acquisitions include servicing rights underlying $24 billion in government sponsored enterprise mortgages, and another $24 billion sub-servicing contract in mortgages.

Jay Bray, Chairman and CEO of Mr. Cooper Group Inc., says that he is optimistic that this new liaison will begin a new phase in the management of home finances as this transaction looks forward to augment the company’s profitability targets and portfolio growth, along with providing access to Seterus’s 300,000 customers.

On the other hand, Jay Bellissimo, General Manger, Cognitive Process Transformation, IBM Global Business Services, explained that since 2008 the portfolio of distressed loans is much stable now but is no longer a core asset. The time is suitable to divest this business to a mortgage servicing specialist who will advance it even further. The move is also in line with IBM’s revised business strategy that is to move away from the non-core businesses and to accelerate the company’s security, cloud, cognitive computing and mobile businesses, among other strategic focus areas.

Mr. Cooper expects to fund this transaction, targeted to close in the first quarter of 2019, with the financing on the mortgage servicing rights and cash. 

Related Ticker: COOP

Momentum Indicator for COOP turns positive, indicating new upward trend

COOP saw its Momentum Indicator move above the 0 level on April 19, 2024. This is an indication that the stock could be shifting in to a new upward move. Traders may want to consider buying the stock or buying call options. Tickeron's A.I.dvisor looked at 80 similar instances where the indicator turned positive. In of the 80 cases, the stock moved higher in the following days. The odds of a move higher are at .

Price Prediction Chart

Technical Analysis (Indicators)

Bullish Trend Analysis

The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. of 50 cases where COOP's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .

Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where COOP advanced for three days, in of 326 cases, the price rose further within the following month. The odds of a continued upward trend are .

The Aroon Indicator entered an Uptrend today. In of 291 cases where COOP Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .

Bearish Trend Analysis

The 10-day RSI Indicator for COOP moved out of overbought territory on April 01, 2024. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 59 similar instances where the indicator moved out of overbought territory. In of the 59 cases, the stock moved lower in the following days. This puts the odds of a move lower at .

The Moving Average Convergence Divergence Histogram (MACD) for COOP turned negative on April 03, 2024. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 45 similar instances when the indicator turned negative. In of the 45 cases the stock turned lower in the days that followed. This puts the odds of success at .

Following a 3-day decline, the stock is projected to fall further. Considering past instances where COOP declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .

COOP broke above its upper Bollinger Band on March 20, 2024. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.

Fundamental Analysis (Ratings)

Fear & Greed

The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 75, placing this stock better than average.

The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.

The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. COOP’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.

The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.

The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.158) is normal, around the industry mean (4.672). P/E Ratio (10.514) is within average values for comparable stocks, (53.143). Projected Growth (PEG Ratio) (0.000) is also within normal values, averaging (3.039). COOP has a moderately low Dividend Yield (0.000) as compared to the industry average of (0.042). P/S Ratio (2.266) is also within normal values, averaging (4.549).

The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating slightly weaker than average sales and a marginally profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.

Notable companies

The most notable companies in this group are VISA (NYSE:V), Mastercard (NYSE:MA), American Express Company (NYSE:AXP), PayPal Holdings (NASDAQ:PYPL), Capital One Financial (NYSE:COF), United Rentals (NYSE:URI), Discover Financial Services (NYSE:DFS), Synchrony Financial (NYSE:SYF), SLM Corp (NASDAQ:SLM), Bread Financial Holdings (NYSE:BFH).

Industry description

A leasing company (e.g. United Rentals, Inc. ) is typically the legal owner of the asset for the duration of the lease, while the lessee has operating control over the asset while also having some share of the economic risks and returns from the change in the valuation of the underlying asset. Per capita disposable income and corporate earnings or cash flow could be some of the critical metrics for this business – the higher the values of these metrics, the potentially greater ability of consumers/businesses to afford apartments/office spaces for rent. Other finance companies include credit/debit card payment processing companies (e.g. Visa Inc. and Mastercard), private label credit cards providers (e.g. Synchrony Financial) and automobile finance companies (e.g. Credit Acceptance Corporation).

Market Cap

The average market capitalization across the Finance/Rental/Leasing Industry is 11.33B. The market cap for tickers in the group ranges from 2.17K to 573.25B. V holds the highest valuation in this group at 573.25B. The lowest valued company is AZNVF at 2.17K.

High and low price notable news

The average weekly price growth across all stocks in the Finance/Rental/Leasing Industry was -1%. For the same Industry, the average monthly price growth was 13%, and the average quarterly price growth was 121%. CAFI experienced the highest price growth at 71%, while BRDSQ experienced the biggest fall at -28%.

Volume

The average weekly volume growth across all stocks in the Finance/Rental/Leasing Industry was 13%. For the same stocks of the Industry, the average monthly volume growth was -22% and the average quarterly volume growth was -1%

Fundamental Analysis Ratings

The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows

Valuation Rating: 52
P/E Growth Rating: 53
Price Growth Rating: 55
SMR Rating: 62
Profit Risk Rating: 75
Seasonality Score: 9 (-100 ... +100)
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COOPDaily Signal changed days agoGain/Loss if shorted
 
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A.I.Advisor
published price charts
A.I. Advisor
published General Information

General Information

a holding company with interest in mortgage reinsurance

Industry FinanceRentalLeasing

Profile
Fundamentals
Details
Industry
Specialty Insurance
Address
8950 Cypress Waters Boulevard
Phone
+1 469 549-2000
Employees
6800
Web
https://www.mrcoopergroup.com
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